Net Promoter Score & how it improves your Hotel Feedback Management

Posted on Posted in Feedback Management

Did you know? By asking a single question, you can track & understand your promoters and detractors, thus producing a clear measure of your hotel’s performance from your Guest’s perspective. Studies show that companies with higher than average Net Promoter Score (NPS) achieve two times long-term profitable growth.

NPS is based on the fact that customers can be divided into three categories.

  • Promoters – loyal enthusiasts who keep buying from a company and urge their friends to do the same.

  • Passives – satisfied but unenthusiastic customers who can be easily wooed by the competition.

  • Detractors – unhappy customers that can easily be swayed away by competition.

Efficiency of your hotel’s growth is the % of customers who are promoters minus the % who are detractors. This equation is the Net Promoter Score or NPS.

How does the scoring work?

Answers to the single question are scaled on a 0-to-10 scale. This scale is easy for customers to understand. And the responses cluster into three groups, each characterized by a different set of attitudes, behaviours and, hence, economic value.

Promoters (9 or 10)

Guests scoring 9 or 10 are typically “Promoters” of your Hotel and are your loyal & enthusiastic fans. They advocate you among their network. They will remain your customers and will increase their purchases over time. They will also account for more than 70% of referrals for your business.

Passives (7 or 8)

This is the “passively satisfied” group of customers. That means they are satisfied—for now. Their repurchase or referral rates probably 50 percent lower than the rate of the promoters. They can be easily swayed by a competitor and may defect if they see a smart offer or better rates from your competitor.

Detractors (0 to 6)

Detractors are unhappy customers. They account for over 80% of negative publicity & will defect. During their life time with you they may appear profitable from a transactional perspective, however their criticisms and negative attitudes will not only impact your hotel’s reputation, but will also discourage new Guests from coming on-board and can even have a demotivating impact on your employees.

Net Promoter Score

NPS is the percentage difference between promoters (those scoring between 9 & 10) minus the detractors (those scoring less than 6). This number should be tracked regularly, not just at the overall hotel level but also for each key department or service that your hotel offers. We can help you track this at various levels including

  • Customer segments or types

  • Geographic split

  • Demographics

  • Groups

This simple process can help your team focus on two key targets of

  1. Creating more promoters

  2. Reducing detractors.

In essence this can be termed as your hotels ‘customer balance sheet’.

What else can NPS do?

As a hotel if you track your NPS you can work with your customers to find the reasons for their ratings using unstructured, open-ended question that we provide in our KePSLA’s Feedback Management Solution (FMS). This can provide your hotel the opportunity to hear unbiased comments from your Guests in their own words. As your Hotels Key Manager, you can then use this feedback to address important customer concerns and to drive innovation which can generate more promoters.

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